Shopping Goodies

by Gisele Glosser

Shopping often involves
discount and sale price. But having a good number sense will
make you a better consumer. In this article we will examine and
compare common sales offers used in retail stores.

Buy 1, Get 1 Free. In this world, nothing is free. The
best way to compute the cost per item is to take the price for one
item, and divide by two. Then you can determine if this is a good price.
For example, if the price for one is $19.99, then the cost per item
is roughly $20 divided by 2, or $10 each.

Buy 2, Get the Third free. The best way to compute the
cost per item is to take the price for two items, and divide by
three. Then you can decide if this is a good price. For example, if
the price for one is $7.49, then the cost per item is roughly $15
divided by 3, or $5 each.

Buy 1, Get One 1/2 Price. If the price for one is $19.99,
then the cost per item is approximately the sum of $20 and $10,
divided by 2, which is $15.

Buy 1, Get the Second for $1. If the price for one is
$19.99, then the cost per item is about $21 divided by 2, or $10.50.

For each of the offers
above, we computed the actual cost per item. Once you know the
actual cost, you can determine if an offer is a good, and the true value it
presents.

Another common technique
for boosting retail sales is through coupon offers. If there is more than
one coupon, things can get confusing. For our first example, suppose the same store offers
you these coupons:

20% off any purchase

$10
off your purchase of $30 or more

Which coupon would you
choose and why? The answer depends on how much you buy from the
store. The first coupon is a discount rate of 20% -- the discount will
vary in direct proportion to the amount of your purchase. The second coupon
is a fixed amount off a minimum buy. Let's compare these coupons for
several purchase amounts to see which one saves you more.

Ex. 1

How
Much Will You Save?

purchase

20% off

$10 off $30 or more

$20

$4

$0

$25

$5

$0

$30

$6

$10

$35

$7

$10

$40

$8

$10

$45

$9

$10

$50

$10

$10

$55

$11

$10

$60

$12

$10

In example 1, the break-even
point is a purchase of $50. For our second example, suppose the same store offers
you these coupons:

20% off any purchase

$25
off your purchase of $100 or more

Once again, which coupon you choose
depends on how much you buy. Let's compare these coupons for several
purchase amounts to see which one saves you more.

Ex. 2

How
Much Money Will You Save?

purchase

20% off

$25 off $100 or more

$25

$5

$0

$50

$10

$0

$75

$15

$0

$100

$20

$25

$125

$25

$25

$150

$30

$25

$175

$35

$25

$200

$40

$25

In example 2, the break-even
point is a purchase of $125.

In the problems above, we
computed the amount saved for each coupon (i.e., the discount). To
compute the sale price (the amount you actually pay), you would have
to subtract the discount from your purchase amount. If you only have
a certain amount of money to spend, then sometimes it is easier to
compute the sale price directly. To do this, take the discount rate
and subtract it from 100%, then multiply the result by your purchase
amount. In the case of 20% off, you would multiply your purchase
amount by 80% to get the amount you will actually pay. This is shown
in example 3 below.

Ex. 3

How
Much Money Will You Pay?

purchase

20% off

$10 off $30 or more

$20

$16

$20

$25

$20

$25

$30

$24

$20

$35

$28

$25

$40

$32

$30

$45

$36

$35

$50

$40

$40

$55

$44

$45

$60

$48

$50

In example 3, the break-even
point is a purchase of $50.

The information above might
be common sense for some readers, and an eye-opener for others. From
my experience, people vary widely when it comes to number sense and
shopping habits. In any event, it is good to be able to catch a cashier's
errors when making a purchase.